UK's Topps Tiles sees $5.2 million annual cost hike from new wage expenses (updated)

Topps Tiles

02/04/2025 07:30

HY group sales, excluding CTD, up 4% year on year

Sales through digital channels up 15% in HY period

Adds share move in paragraph 2, details on sales in paragraphs 4 and 5, background in paragraphs 6-8

April 2 (Reuters) -
UK tile retailer Topps Tiles TPT.L said on Wednesday it expected its annual cost base to rise by about 4 million pounds ($5.2 million) from April due to national living wage and insurance expenses, after posting a 4% rise in half-year sales. Full-year profit for 2023/24 was 6.3 million pounds.

Shares in the company were down 5.3% at 32.20 pence in early trade.

Finance minister Rachel Reeves, in her first budget last year, raised employers' social security contributions by 1.2 percentage points to 15% from April 2025, raising payroll costs.

Topps Tiles said group sales, excluding the acquisition of some assets from CTD Tiles last year, in the 26 weeks ended March 29 were helped by solid performance in online trading, where sales in March were up by a high single-digit percentage, year-on-year.

Sales made through Topps Tiles' digital channels were up 15% in the first-half period, and online trade traffic rose "approximately four-fold", the company said in a statement.

Topps Tiles last year unveiled a new growth strategy, with a focus on increasing its online business and expanding into the market for hard wall and floor surface coverings and related products.

MS Galleon, the top investor in Topps Tiles, late last year raised
concerns
 about long-term margin erosion, and had called for a review of strategy.

Topps Tiles said it had made "good progress" in identifying potential candidates for the CEO role after Rob Parker
said
 in January that he would retire after 18 years with the company.

Topps' positive sales update contrasts sharply with the bleak 2025 outlook
provided
 by Britain's largest building materials supplier, Travis Perkins TPK.L, on Tuesday.

     ($1 = 0.7745 pounds)

 (Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Mrigank Dhaniwala and Kevin Liffey)

 ((abyjose.koilparambil@thomsonreuters.com))